Question 1

Economic growth is shown by the production possibilities curve shifting toward the origin.

Accepted Answer

A) True 
 B)False

Question 2

An aging population and slower labor force growth are contributing to a slower rate of increase in U.S. living standards.

Accepted Answer

A) True 
 B)False

Question 3

The United States has the highest living standard in the world based upon real GDP per capita statistics.

Accepted Answer

A) True 
 B)False

Question 4

Use the production possibilities curve model to show economic growth. Explain why your graph shows growth. What would have to happen in order for growth to occur?

Accepted Answer

The answer of Use the production possibilities curve model to...

Question 5

What factors figure prominently in accounting for economic growth in the United States?

Accepted Answer

The answer of What factors figure prominently in accounting for...

Question 6

The Malthusian problem is:

Accepted Answer

A)  too many dollars chasing too few goods 
B)  that society will be forced to the subsistence level because population grows geometrically while food and fiber grows arithmetically 
C)  trade barriers obstruct technology transfer 
D)  a means of calculating interest on development bank loans 
E)  uneven returns on human capital

Question 7

Answer the next 3 questions based upon the following diagram.
 
-The country that exhibits the greatest economic growth is:

Accepted Answer

A)  Growlastia with its shift from curve CC to DD 
B)  Growlastia with its shift from curve DD to CC 
C)  Hedonia with its shift from curve AA to BB 
D)  not shown in either diagram

Question 8

Which of the following is a policy designed to accelerate technological progress?

Accepted Answer

A)  personal income tax reductions to encourage greater work effort 
B)  development loans for sewer systems 
C)  higher corporation tax rates 
D)  a research and development tax credit

Question 9

All of the following could be considered as a hindrance to economic development in DCs except:

Accepted Answer

A)  low rates of saving 
B)  low investment in real and human capital 
C)  capital flight 
D)  stable political systems

Question 10

What has been the trend in living standards in the United States in the decades following the 1950s? How has this trend influenced the American economic agenda?

Accepted Answer

The answer of What has been the trend in living...

Question 11

Which of the following statements is correct?

Accepted Answer

A)  the average annual rate of growth in real GDP per capita was considerably slower from 2000-2005 compared to 1995-2000 
B)  the average annual rate of growth in real GDP per capita since the 1950s has increased 
C)  living standards in the United States have continuously declined in the post-World War II period 
D)  output per worker-hour in the United States is the lowest among the industrially advanced nations

Question 12

Potential real GDP estimates the real GDP under the assumption that the economy is at full employment and an average number of hours will be worked during the year at an average output per worker-hour.

Accepted Answer

A) True 
 B)False

Question 13

What are the supply and demand factors that decide economic growth? Make a relevant generalization about each one and relate them to the production possibilities curve to illustrate economic growth.

Accepted Answer

The answer of What are the supply and demand factors...

Question 14

The International Bank for Reconstruction and Development has focused its lending on space programs and heavy manufacturing.

Accepted Answer

A) True 
 B)False

Question 15

If a system is "closed," it means that:

Accepted Answer

A)  you can't get out 
B)  wastes are injected from outside and degrade environmental quality 
C)  An Inconvenient Truth is the only movie you can watch 
D)  growth is impossible 
E)  wastes must be recycled in the long run or environmental quality will degrade
F) the price system cannot be used to manage growth and the environment

Question 16

The pursuit of appropriate technology means adopting large-scale, capital- intensive technology.

Accepted Answer

A) True 
 B)False

Question 17

Real GDP per capita is an ideal measure of living standards and the economic well-being of society's members.

Accepted Answer

A) True 
 B)False

Question 18

What is meant by the productivity slowdown? What are the possible explanations for the slowdown? Why did productivity subsequently speed up?

Accepted Answer

The answer of What is meant by the productivity slowdown?...

Question 19

The Club of Rome:

Accepted Answer

A)  has made forecasts over the past several decades of collapse in world economic growth 
B)  tries to reconcile economics with religion 
C)  is a club that researches strategies for delivering faster economic growth on a global basis 
D)  recently moved to Milan 
E)  has generally made optimistic projections about resource depletion, environmental damage and population trends, rejecting Malthusian beliefs

Question 20

The World Bank:

Accepted Answer

A)  makes loans to industrially advanced countries to finance military hardware 
B)  acquires funds from industrially advanced countries and makes loans to lesser-developed countries for development projects 
C)  operates an international system of automated teller machines 
D)  none of the above

Exam 12: Maintaining a Rising Level of Output: The Importance of Economic Growth

Economic growth is shown by the production possibilities curve shifting toward the origin.

An aging population and slower labor force growth are contributing to a slower rate of increase in U.S. living standards.

The United States has the highest living standard in the world based upon real GDP per capita statistics.

Use the production possibilities curve model to show economic growth. Explain why your graph shows growth. What would have to happen in order for growth to occur?

What factors figure prominently in accounting for economic growth in the United States?

The Malthusian problem is:

Answer the next 3 questions based upon the following diagram. -The country that exhibits the greatest economic growth is:

Which of the following is a policy designed to accelerate technological progress?

All of the following could be considered as a hindrance to economic development in DCs except:

What has been the trend in living standards in the United States in the decades following the 1950s? How has this trend influenced the American economic agenda?

Which of the following statements is correct?

Potential real GDP estimates the real GDP under the assumption that the economy is at full employment and an average number of hours will be worked during the year at an average output per worker-hour.

What are the supply and demand factors that decide economic growth? Make a relevant generalization about each one and relate them to the production possibilities curve to illustrate economic growth.

The International Bank for Reconstruction and Development has focused its lending on space programs and heavy manufacturing.

If a system is "closed," it means that:

The pursuit of appropriate technology means adopting large-scale, capital- intensive technology.

Real GDP per capita is an ideal measure of living standards and the economic well-being of society's members.

What is meant by the productivity slowdown? What are the possible explanations for the slowdown? Why did productivity subsequently speed up?

The Club of Rome:

The World Bank: